Dear Brittany,
Well, if so, then I'm not gonna discuss about this issue any further over here.
Actually, I already contacted Etsy team, and according to their reply, I've done all I can do and I did not against any Etsy's policy so they'll stand on seller's side. Regard to Paypal's policy, you can only file a complaint within 45 days and this was an order 2 months ago. so.... I don't think I'll get any problems from Paypal.
What I am trying to say over here is, why should the seller got blamed for the problem causing from the buyer himself. If every buyer claims that he did not receive the order, are you gonna refund all of them even though it's not your fault at all?? It's not just about the money, it's also about protecting our sellers' right. That's all!
Anyway, thanks for all the response to this thread.